Private-market investments are complex, carry a high level of risk and are not suitable for everyone. Read this warning, and the documents for any opportunity, before you decide. It does not describe every risk.
1. Your capital is at risk.
You can lose some or all of the money you invest. There is no guarantee of any return, and no guarantee that you will get your capital back.
Loss may exceed expectations and, where documents impose further funding obligations, you may be required to provide additional capital. Neither eligibility nor sponsor screening assures the preservation of capital or an outcome.
2. Limited liquidity.
Private-market investments are generally illiquid. There is usually no public market, you may be unable to sell or withdraw before the end of the term, and any exit may depend on the sponsor, other investors or events outside your control. Lock-up periods and notice periods can be long.
There may be no secondary market at all. Transfers can require consent, be restricted by law or contract, or occur only at a substantial discount. Redemptions may be gated or suspended, distributions delayed and the holding period extended beyond the expected term. A planned exit is not a binding promise of liquidity.
3. Valuation uncertainty.
Private assets are not priced continuously. Valuations are estimates, may be infrequent and may differ from the price you could actually obtain.
Models, assumptions, comparable transactions and manager judgement may be used. Stale or optimistic estimates can overstate recoverable value. Independent valuations may be unavailable and a valuation is not a price at which a buyer must transact.
4. Limited information.
There is usually less public information about private investments than about listed securities, and reporting may be less frequent and less standardised.
Sponsor materials may be incomplete, inaccurate or not independently tested. Investors may have limited information, control, voting or enforcement rights. Conflicts of interest can affect reporting and decisions; documents and independent advice are essential.
5. Concentration.
An investment in a single asset, project, company, sponsor or strategy can be highly concentrated. Poor performance of one holding can have a large effect.
Diversification may be limited and correlations can increase in stressed markets. Exposure to a single geography, sector, vintage, currency or event can magnify loss. Holding several investments does not establish adequate diversification.
6. Sponsor, manager and counterparty risk.
Outcomes depend heavily on the skill, integrity and resources of sponsors, managers and other counterparties. They may make errors, face conflicts of interest or become insolvent.
A sponsor, borrower, administrator, custodian, insurer or other counterparty may default, fail to perform or become insolvent. Recoveries depend on legal rights, ranking, available assets and enforcement, which may be costly or ineffective. Screening does not eliminate fraud, conflicts or counterparty failure.
7. Debt-based and leveraged investments.
Credit and other debt-based investments carry the risk that borrowers do not pay interest or repay principal, that security proves insufficient or hard to enforce, and that recoveries take longer than expected. Leverage can magnify both gains and losses.
Borrowing at asset, vehicle or investor level magnifies losses and can trigger margin calls, refinancing pressure, forced sales or insolvency. Rising rates and covenant breaches can impair debt service and equity value. Security and priority do not ensure recovery.
8. Litigation and other event-driven investments.
Investments linked to legal claims or other specific events can depend on a single binary outcome, can take much longer than expected, and can be affected by changes in law, procedure, regulation or enforcement. A claim can fail, settle for less than expected, or be delayed for years, and you can lose your entire investment.
9. Real assets, collectibles and fine art.
Real assets and collectibles can be hard to value, costly to hold, insure, store or maintain, and slow to sell. Their value can fall with market conditions, authenticity or title disputes, damage or changes in taste.
10. Special situations and distressed assets.
Distressed and special-situation investments involve companies or assets under financial or operational stress, which increases the risk of loss, legal disputes and delay.
11. Fees and costs.
Fees, costs and expenses at different levels can reduce your returns, and may be charged whether or not an investment makes a profit. The documents for each opportunity set them out.
12. Currency, tax and legal risk.
Exchange rates, taxes, regulation and law can change, and can differ between countries. Tax treatment depends on your circumstances and may change.
Currency movements can reduce or eliminate returns when an investment and your spending currency differ. Hedging may be unavailable, costly or imperfect. Capital controls and convertibility restrictions can prevent transfers. Changes in taxation, law, regulatory interpretation or enforcement may change net outcomes, eligibility or the viability of an investment; cross-border remedies may be limited.
13. Technology and operational risk.
Online platforms can be affected by outages, errors, cyber attacks or other operational failures.
Fraud, misappropriation, false documents, cybercrime, payment diversion, weak controls, human error, service-provider failure and loss of records can cause loss or delay. Insurance, controls and platform screening may not identify or cover these events. Independently confirm instructions and the identity and authority of recipients.
14. Past performance and forecasts.
Past performance is not a reliable guide to future results. Projections and targets are not guarantees.
Forward-looking statements depend on assumptions that may not hold. Scenarios may omit adverse events and are not probabilities or promises. Actual outcomes may differ materially; information may not be updated when circumstances change.
15. No advice.
Multiplier is a technology platform and does not give investment, legal or tax advice. Take independent professional advice, and read the documents for any opportunity, before investing. Only invest money you can afford to lose and do not expect to need during the term.
Assess your knowledge, capacity for loss, liquidity needs and concentration, and take independent investment, legal, tax and accounting advice appropriate to your circumstances and jurisdiction. This general disclosure is not exhaustive, does not assess suitability and does not replace product-specific documents. Do not proceed if you do not understand the rights, obligations and risks.
16. Investor protection and compensation.
Do not assume that an investment, platform activity, sponsor or issuer is protected by a deposit guarantee, investor compensation, insurance or other investor-protection scheme. Any protection depends on the particular activity, parties, jurisdiction and eligibility rules and must be established from the applicable documents and law. Regulatory oversight, where it applies, does not prevent investment losses. Regulatory status is described in the Regional notices.
